RO/RE instructions: Format 1: Completion of Format 1

When Format 1 is displayed make sure it will allow you to make the necessary entries for the type of repayment you are dealing with.

If there has been a previous payable order issued for that year and no further claim has been registered you will only be allowed to view the computation.

If however you want to issue a further payable order

press CTRL and A

use RC to register the further claim. 2560 (side 1)

For 1989-90 or earlier the field INCOME FOR AGE ALLOWANCE will not appear on Format 1.You will have to calculate any age allowance due.

For 1990-91 onwards

if the taxpayer or spouse was born before 1901 and the field INCOME FOR AGE ALLOWANCE does not appear on Format 1 you will have to calculate any age allowance due

or

if the taxpayer or spouse is 65 or over during the year of claim make sure the field INCOME FOR AGE ALLOWANCE appears in Format 1. If it does not appear

If there has been a previous payable order issued automatically for that year Format 1will show the amount, serial number and date of issue.

Complete Format 1 as follows.

FIELD

NOTES AND ACTION REQUIRED

CLAIM NOT PURSUED?

Leave blank. The instructions on when and how to complete this field are at RM5092.

CANC

Leave blank. The instructions for re-issuing a payable order are at RM5040.

CANCELLED SERIAL NO

Leave blank. The instructions for re-issuing a payable order are at RM5040

DESCRIPTION OF INCOME

Building society interest (received) 1991-92 until 2015-16 where BSI is·

taxed before receipt enter the amount in the BANK/BUILDING SOC INTEREST field

paid gross treat it as UNTAXED INTEREST.

If you need to enter items of income other than those already shown on screen you can do so by typing the description in the two free format fields. Income which attracts notional tax, for example Stock Dividends, must be entered in a free format field. If you typed in a description last year or in an earlier repayment for this year it will be recalled. You cannot use =%$£

Note that from April 2016 the Personal Savings Allowance and Dividend Tax Allowance apply and repayments are not usually appropriate. |
| NET/GROSS | Enter N or G to tell the computer whether you are entering the amount of income net or gross.
You must make an entry if you entered a source description on that line in the free format fields.
You cannot make an entry if there is no source description on that line in the free format fields.
This field will appear on the Bank/Building Soc Interest line from 1991-92 onwards. You will have to make an entry if you enter an amount on the same line. |
| REPAYABLE | Enter Y or N to tell the computer whether or not the tax is repayable.
There must not be an entry if there is no source description on that line.
There must be an entry if there is an entry in TAX on the same line.
Enter N if the tax is notional, for example notional tax on a Stock Dividend. See RM4036. |
| AMOUNT | If you entered a source description in the free format fields you must make an entry on the same line.
There cannot be an entry if there is no source description on that line.
There must not be an entry if REPAYABLE is N and the claim is from a non-individual. |
| TAX | If tax has been suffered on any source of income other than Schedule E enter the amount on the same line as the source description.
The only Schedule E tax to be entered is that deducted from casual earnings including exam fees(RM1254).
Any entry of tax for UK Dividends, Bank/Building Soc Interest and Discretionary Trust Income will be checked by the computer to make sure it is in line with the amount of income entered.

Note that from April 2016 the Personal Savings Allowance and Dividend Tax Allowance apply and repayments are not usually appropriate.

ANNUAL PAYMENTS

NET/GROSS

Enter N or G to tell the computer whether you are entering the amount net or gross.

AMOUNT

Enter the amount of any payments to charity under Gift Aid.

REPAYMENT SUPPLEMENT DUE?

If the year is one for which supplement may be due Y will appear in this field. Change to N if

the taxpayer was not resident in the UK during the year of claim

or

the claim was made outside the normal time limits (RM5100)

or

the claim includes Business Expansion Scheme relief.

TAX ADJUSTMENTS

You can only enter one or two of the following acceptable entries. If there are more than 2 entries, include them using the descriptor SUNDRY CR Concessional Relief DTR Double Taxation Relief SUNDRY+ Any other adjustment SUNDRY - Any other adjustment. When making entries you should note

all the above must be followed by an amount

there must be no space between the identifier and the amount

there must be a space between the amount and the next identifier

each identifier may appear only once

DTR should be restricted to a maximum of the UK liability

SUNDRYp will increase the liability and therefore reduce the repayment

SUNDRY- will decrease the liability and therefore increase the repayment.

1994-95 and later For 1994-95pthe following reliefs are not included as ALLOWANCES APA - Additional Personal Allowance SMP - Maintenance payments (the first £1720) WBA - Widow’s Bereavement Allowance BSI - (non MIRAS) Mortgage interest paid. Calculate the amount due in terms of tax. Enter the identifier PTR followed by the amount. The computer will include this amount plus any MCA, included in ALLOWANCES, in the NON-REPAYABLE TAX field in Format 2. Where relief is due for maintenance payments in excess of £1720 (pre-15 March 1988 orders), you must make the repayment manually. Exclude the first £1720 from the NSI computation. Remember to restrict relief on the first £1720 to the correct rate. You must send a letter to the claimant/agent explaining how the non-repayable tax is calculated.

FIELD COMPLETION OF FORMAT 1

NOTES AND ACTION REQUIRED

TAX ADJUSTMENTS

Where relief is due for maintenance payments in excess of £1720 (pre-15 March 1988 orders), you must make first £1720 from the NSI computation. Remember to restrict relief on the first £1720 to the correct rate.

AMOUNT OF PAYMENTS UNDER MIRAS TYPE ARRANGEMENTS

Years up to and including 1990-91 Enter the amount by which you want to extend the basic rate band 1991-92 - 1992-93 From 6 April 1991 MIRAS relief on most qualifying loans is restricted to the basic rate. Entries are only required in this field in the following cases. Where higher rate relief is due Check whether higher rate relief is due - see RE396. If it is enter the amount of relief due in this field. Where an age related allowance is due (in full or reduced) Enter the amount of MIRAS interest in this field. 1993-94 onwards The field will not be displayed. Deal with the repayment manually where

the taxpayer is liable to higher rate tax

an extension is due to the basic rate band for PAYMENTS UNDER MIRAS

TYPE ARRANGEMENTS.

ALLCES ETC

To enable the computer to calculate allowances correctly make sure that

the DOB if known has been entered in CZ

you enter the allowances or deductions using the identifiers shown in RM2564

the correct single or married identifier(s) are used

you only enter the identifier if Age Allowance or reduced Age Allowance is due. If you enter an identifier and an amount the computer cannot calculate the correct allowance. The amount you entered will be re-displayed. You must delete the figure so that the computer can re-calculate the correct allowance.

Married Allowance When a reduced amount of MAA or MAE is due because the taxpayer married during the year you must enter the allowance amount after both allowance descriptors. For example, if the husband were under 65, the wife between 65 and 74 and the date of marriage 7 March 1992 you should enter `PA3295 MAA1965’. Transfer of husband’s allowances to wife The detailed instructions about the transfer of the husband’s allowances to the wife are covered at In502. When you receive a CY claim to repayment from the wife in a case where a valid election for the transfer of the husband’s allowances has been made send a letter to the wife with the repayment explaining - the allowances included in the computation are provisional

based on her husband’s estimated income

the repayment may be subject to amendment at a later date when the husband’s actual income details are known.

Building Soc. Interest(paid)/Loan Interest (paid) - non MIRAS For qualifying mortgage interest you must use the identifier BSI. Use the identifier LOAN to enter interest paid on other qualifying loans. From 6 April 1991 relief for qualifying mortgage interest paid is restricted to the basic rate. If you receive a claim to repayment where higher rate tax is due

work out the liability for the year manually restricting the basic rate band by the amount of qualifying mortgage interest paid

enter the amount of qualifying interest in Format 1

press SEND

deduct the tax due shown in Format 2 from the amount you have calculated manually

enter Y in the GO BACK? field

enter the difference between the two amounts in the TAX ADJUSTMENTS field SUNDRYp

press SEND.

The tax due shown in Format 2 should be the same as the amount you worked out manually.

Write to the claimant explaining why you have made the adjustment

how the adjustment is calculated.

From 6 April 1994 relief for qualifying mortgage interest paid is restricted to 20%. For 1994-95 you need no longer make tax adjustments in higher rate cases, in this respect. |
| INCOME FOR AGE ALLOWANCE | If the total income for the year is not shown on screen enter the claimant’s gross income for that year to enable the computer to calculate the correct age allowance for you.
If the total income for the year is shown on screen make sure that this field is empty.
You must make an entry here if you are working an instalment claim. |
| TOTAL TAX ALREADY
REPAID MANUALLY
FOR THIS YEAR | Enter any amount which was previously repaid manually for this year
or
repaid in another District. |
| . | Press SEND |

press CTRL and A

use CZ to enter the correct date of birth on the claimant’s record (RM1520).